Going Green - by Dan Liebman

During most of the past 200-plus years, the Kentucky General Assembly convened for only 60 days every two years. To poke fun at the lawmakers, a group of Frankfort, Ky., citizens once printed bumper stickers calling for the group to instead meet two days every 60 years.

Now, the Kentucky Legislature meets annually, 60 days in even-numbered years and 30 days in odd-numbered years; the 2009 session is set to begin Feb. 3. And, once again, the horse industry is in need of help from its elected officials. Unfortunately, the state budget, as it should, will be the primary focus of this short meeting of Kentucky’s state senators and representatives.

Though several bills have either been pre-filed or proposed to aid Kentucky’s ailing horse industry, lawmakers must deal with a projected $456-million state budget shortfall, making it a tough time for any industry to lobby for funds that would make that deficit even larger.

Kentucky’s equine industry had high hopes a year ago when Gov. Steve Beshear took office. As a candidate, Beshear received considerable support from industry participants and made the need for alternative gaming one of his key platforms. Alas, those in the state who make their living from horses were again disappointed as gaming legislation went nowhere yet again. The bill to put the measure on the ballot as a constitutional amendment for Kentucky citizens to decide on video lottery terminals was not pushed hard by the governor, nor by Speaker of the House Jody Richards.

A day after this column is printed, Jan. 5, an election for speaker will be held, with the representatives from Kentucky’s 100 House districts choosing between Richards and Rep. Greg Stumbo, a former Kentucky Attorney General and House Majority Leader. Stumbo has pre-filed a bill authorizing video lottery terminals at Kentucky’s racetracks, giving those in the equine industry a keen interest in the House Speaker vote.

Last summer, by executive order, Gov. Beshear created the Task Force on the Future of Horse Racing in Kentucky. The group, chaired by owner/breeder Tracy Farmer, made its initial report public last month. Though alternative gaming was not specifically called for, the report noted how states such as neighboring Indiana increased their purses with revenue from slot machines. The report also includes data from a recent Thoroughbred Racing Associations study that claims: “Among racetracks with legalized alternative gaming as of November 2008, combined annual purses are forecast to increase 45.5% by 2013, while combined annual purses at racetracks without legalized alternative gaming are expected to decline 11.9% by 2013.”

Other main points contained in the report call for additional staff members for the Kentucky Horse Racing Commission, a pari-mutuel monitoring system, licensing and regulation of advance deposit wagering companies, and the establishment of a nonprofit research and testing laboratory.

It is often easy to identify problems and offer solutions, while it is much harder to find mechanisms to fund such initiatives. In a recessionary time, that becomes much more important.

Increasing takeout and reducing purses, both discussed in the report, should be non-starters.

Horse racing and breeding is the most important industry in Kentucky, accounting for $4 billion annually and responsible for upward of 100,000 jobs. Unfortunately, many elected to represent the citizens of the state continue to see the industry only as wealthy breeders, wealthy owners, and wealthy racetracks, despite study after study showing that not to be the case.

Gov. Beshear said alternative gaming will not be brought up this session; he wants to raise the state’s cigarette tax, one of the lowest in the nation, 70 cents a pack. In fact, had the governor pushed through alternative gaming legislation a year ago, Kentucky might already be on its way to reducing its deficit through video lottery terminals.

Members of the legislature will not dip into the state’s General Fund to help horsemen, meaning though the task force has made some interesting recommendations, finding the money to implement them will not be easy.